Italy’s Fiat says it has pulled out of a money-losing Chinese joint venture with Nanjing Automobile after the firm merged with bigger Chinese group Shanghai Motors SAIC. Fiat will keep working with Nanjing in making vans and parts, but analysts say the break-up casts doubt on Fiat’s ability to meet its target of selling 300,000 units in China by 2010.
China is now the world’s fastest-growing auto market, with 8.5 million sales forecast in 2007. Beijing now invites foreigners to import their cars, providing they also make cars in China. Furthermore, analysts agree China’s own product is swiftly getting better.